Those not familiar with the financial industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans should know that our capital market desk(s) work with more than 135 Fortune corporation treasury teams, each of Wall Street’s lead underwriter investment banks, dozens of municipal debt issuers and a discrete spectrum of the industry’s most demanding investment managers and public plan sponsors. Of equal importance, our ethos is driven by giving back and paying forward to those members of the US military service-disabled veteran community and their families who simply do not have the depth of resources and access to advanced education programs and private sector job opportunities that so many of us take for granted.

Throughout the year, Mischler Financial Group advocates on behalf of the SDV community through sponsorship of mentoring programs and direct financial assistance to veteran-centric philanthropic organizations. During the months of May and November, we dedicate a percentage of the firm’s profits to honor Memorial Day and Veterans Day respectively. In our recognition of Memorial Day 2018, we have made our annual Memorial Day Month pledge to the Semper Fi Fund, one of the highest rated non-profit organizations. A full release of this announcement was made May 1 and we thank our clients and partners in advance for working with our primary DCM and ECM teams and our secondary market trading desks to make this Memorial Day month memorable for the veterans and their family members who have sacrificed so much to make our lives safer.

Debt Market Comment |Investment Grade New Issue Re-Cap

It was a great day for a goose egg with nothing having priced in our IG dollar DCM heading into the weekend and given the recent soft primary market tone in anticipation of a potentially much busier week ahead. That’s right, I’ve spoken with the top 24 syndicate desks with some interesting sound bites. Most prominently, volume ahead can be heavily influenced by any one or a combination of anticipated M&A related financings among which are United Technologies Corp., Dr. Pepper Snapple Group, Bayer AG and General Dynamics Corp. Also, “if” HSBC decides to print a massive transaction, it too can upward skew the numbers. The big assumption, as one person in the know expressed, is, “it’s going to be busyif the market doesn’t completely melt down!”

But why listen to me when you can read it direct from the 24 syndicate desks who price over 80% of the IG debt deals in Corporate America? That’s what the Friday “QC” brings you every week and that’s why this edition is called the “Best and the Brightest!” They are all waiting patiently below with their numbers and meaningful comments but as always let’s first run through this week’s recaps before I set the table for you for next week.

Get informed and enjoy the read but most of all…

Have a great weekend!

Ron Quigley, Managing Director & Head of Fixed Income Syndicate

Here’s a look at the WTD and MTD IG Corporate new issue volume as measured against syndicate desk estimates:

The IG Corporate WTD total is 85.00% of this week’s syndicate midpoint average forecast or $22.05b vs. $25.94b.

MTD we’ve priced 10.29% of the syndicate forecast for April IG Corporate new issuance or $13.875b vs. $134.84b.

Investment grade corporate bond trading posted a final Trace count of $16.4b on Thursday versus $19.3b on Wednesday and $22b the previous Thursday.

The 10-DMA stands at $18.8b.

Taking a look at the secondary trading performance of this week’s 35 IG Corporate and 1 SSA new issues, of the 36 IG deals that priced, 22 tightened versus NIP for a 61.00% improvement rate, 7 widened (19.50%) and 7 were flat (19.50%).

For the week ended May 2nd, Lipper U.S. Fund Flows reported a net inflow of $996.495m into Corporate Investment Grade Funds (2018 YTD net inflow of $36.571b) and a net inflow of $526.111m into High Yield Funds (2018 YTD net outflow of $14.084b) which was the largest HY inflow since December 2016.

Syndicate IG Corporate-only Volume Estimates For This Week and April

IG Corporate New Issuance

This Week
4/30-5/04

vs. Current
WTD – $22.05b

May 2018

vs. Current
MTD – $13.875b

Low-End Avg.

$25.24b

87.36%

$133.64b

10.38%

Midpoint Avg.

$25.94b

85.00%

$134.84b

10.29%

High-End Avg.

$26.64b

82.77%

$136.04b

10.20%

The High

$20b

110.25%

$110b

12.61%

The Low

$35b

63.00%

$150b

9.25%

The Best and the Brightest” Syndicate Forecasts and Sound Bites for Next Week

I am happy to announce that the “QC” once again received 100% unanimous participation from all 24 desks surveyed for today’s “Best & Brightest” Syndicate edition! Thank you to all of them. 20 of today’s respondents are in the top 21 including 21 of the top 24 according to today’s Bloomberg U.S. IG U.S. Investment Grade Corporate Bond underwriting league table. The 2018 League table can be found on your terminals at “LEAG” + [GO] after which you select (U.S. Investment Grade Corporates). The participating desks represent 80.25% of all IG dollar-denominated new issue underwriting as of today’s table share percentage which simply means they are the ones with visibility. But it’s not only about their volume forecasts; it’s also about their comments! This core syndicate group does it best, they know best, so they are the ones you WANT and NEED to hear from. It’s a great look at the week ahead.

*Please note that these are Investment Grade Corporates only. They do not include SSA issuance unless otherwise noted.

As always “thank you” to all the syndicate desks that participated in today’s survey. I greatly appreciate your time to contribute and for making this edition of the “QC” among Wall Street’s most widely read debt market commentaries.

Before we get to the technical data, let’s first review this week’s top geopolitical risk factors:

Kim Jong-Un offered to readjust North Korea’s “Pyongyang” time zone that runs 30 minutes behind South Korea to match its southern neighbor as a symbol of his commitment to peace. The heads of North and South Korea met on 4/27 in the demilitarized zone to begin negotiations and mutual commitments to completely denuclearize the Korean peninsula. The meeting was historic and made for great photo ops, but was devoid of details. Still, some are holding on to hope this meeting could be the start of one of the great foreign affairs coups of the past century. Meanwhile, U.S. Treasury Secretary Steve Mnuchin is “cautiously optimistic” about negotiations with China over trade tariffs and regulations in the aftermath of Trump’s $50b tariffs in retaliation for China’s stealing of corporate America’s intellectual property. Markets are fearful of a full blown trade war. Talks could reduce tensions, and perhaps even the playing field. China will NOT change its economic policies and was vocal when saying it won’t be “bullied” by the U.S. If talks do bear fruit, it could result in Trump backing off tariff threats. Members of the U.S. delegation include Peter Navarro, Larry Kudlow, Wilbur Ross, Robert Lighthizer and Ambassador Terry Branstad.

In the Middle East, Israeli PM Netanyahu held a televised address last Monday, revealing 50k+ documents and 180+ CDs of data proving Iran’s secret nuclear weapons program is underway in violation of the 2015 deal that Trump wants to renegotiate or abandon. Netanyahu said the docs were moved to a secret Tehran locale post deal. The IAEA, however, sees no “credible indications of activities in Iran relevant to the development of a nuclear explosive device after 2009.”

Italian President Sergio Mattarella prefers to resolve the coalition deadlock by ruling with a short-term gov’t. rather than new national elections. On 4/30, Italy’s leftist 5-Star Movement head, Luigi Di Maio acknowledged his failure to form a coalition gov’t, calling for new elections. 5SM approached the center-left Democratic Party (“PD”) to enter into exploratory talks after it refused to negotiate with the right alliance lest ties with Berlusconi are severed. The nation has had no government for 58 days, or 24 days less than the record 82 set in 1992. Italy had 70 post WWII gov’ts in 72 post-WWII years – one every 1.02 years! – and it is the EU’s 3rd largest economy, the world’s 3rd highest debt-to-GDP ratio at 132.5% and a $2.8 trillion (equiv.) national debt. It’s the EU’s biggest economic risk. Italy’s banking sector holds $220bn of bad loans.

Soft market tone prevails in our IG dollar DCM. In terms of primary markets, of the last 69 IG Corporate deals that priced, 32 saw guidance stagnate “at the number” while 3 of those deals launched at the widest side of guidance. That’s 46.4% of all deals priced in the past 9 sessions! What’s more, many have traded in the gray wider to much wider and with 4 bps average NIC across that period, that’s going in the wrong direction. This week should have been a table setter for what’s expected to be a much bigger week next week in a month that is historically robust.

Now let’s take a look at the critical week-on-week primary market stats:

The IG Corporate WTD total stands at $22.05b. We priced $3.89b less than this week’s average midpoint estimate of $25.94b or <15.00%>.

MTD we priced 10.29% of the syndicate midpoint forecast for IG Corporate new issuance or $13.875b vs. $134.84b.

Entering today’s session, the YTD IG Corporate-only volume is $478.546b vs. the $515.420b YoY which is <$36.874b> or <7.15%> less than a year ago.

The all-in or IG Corporate plus SSA YTD volume is $622.111bvs. $647.736b YoY making it <$25.625b> or <3.96%> less than vs. 2017.

Here are the five key primary market driver averages for the 35 IG Corporate-only deals that priced this week.

o NICS: 5.92 bps

o Oversubscription Rates: 2.16x

o Tenors: 13.17 years

o Tranche Sizes: $630mm

o Spread Compression from IPTs to the Launch: <12.54> bps

Here’s how this week’s critical primary market data compares against last week’s numbers:

Week on week, average NICs widened 2.29 bps to an average 5.92 bps vs. 3.63 bps across this week’s 35 IG Corporate-only new issues that displayed relative value.

Over subscription or bid-to-cover rates, the measure of demand, decreased by 0.37x to an average 2.16x vs. 2.53x.

Average tenors extended by 3.98 years to an average 13. 17 years vs. 9.19 years.

Tranche sizes decreased by $156mm to $630mm vs. $786mm last week.

Spread compression from IPTs to the launch/final pricing of this week’s 35 IG Corporate-only new issues widened by 1.31 bps to <12.54> bps vs. <13.85> bps.

Investment grade corporate bond trading posted a final Trace count of $16.4b on Thursday versus $19.3b on Wednesday and $22b the previous Thursday.

The 10-DMA stands at $18.8b.

The VIX widened 0.49 or 3.18% to 15.90 at yesterday’s close vs. last Friday’s 15.41 close.

Week-on-week, BAML’s IG Master Index widened 4 bps to +116 vs. +112.

Spreads across the four IG asset classes widened 3.50 bps week-on-week to 22.00 vs. 18.50 bps as measured against its cumulative post-Crisis low.

Spreads across the 19 major IG industry sectors widened 4.84 bps to an average 27.05 vs. 22.21 bps as measured against their average cumulative post-Crisis lows!

For the week ended May 2nd, Lipper U.S. Fund Flows reported a net inflow of $996.495m into Corporate Investment Grade Funds (2018 YTD net inflow of $36.571b) and a net inflow of $526.111m into High Yield Funds (2018 YTD net outflow of $14.084b) which was the largest HY inflow since December 2016.

And now it’s time for today’s question posed to the industry’s leading investment grade debt syndicate desks: “What are your thoughts and numbers for next week’s IG Corporate new issue volume?”Wishing you and yours a wonderful weekend!
Ron

Municipal Debt New Issue Outlook Week of 04-16-18: Muni Bond Credit Spreads Stay Flat; Week’s Scheduled Deals: GO Bonds from CA, UConn. and City of Memphis Mischler Muni Market Update looks back to last week’s new issue and muni bond fund flow metrics and provides a focused lens on municipal debt new issuance scheduled for this week. As always, the Mischler Muni Market Outlook provides public finance investment managers, institutional investors focused on municipal debt and muni bond market participants with a summary of the prior week’s municipal bond market activity, including credit spreads and money flows, and a look at pending municipal finance offerings tentatively scheduled for the most current week.

Last week muni volume was about $4.5 billion. This week volume is expected to be about $7.5 billion. The negotiated market is led by $2.1 billion taxable general obligation bonds for the State of California. The competitive market is led by $314.9 million general obligation bonds for the City of Memphis, Tennessee on Tuesday.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6656

During 2017 and 2016 alone, minority broker-dealer Mischler Financial Group Inc. underwriting roles (for which MFG has led, co-managed and/or served as selling group member) have included more than $600 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

Mischler Financial Group is the securities industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans. Mischler is also a federally-certified Service-Disabled Veteran-Owned Business Enterprise (SDVOBE). Mischler Muni Market updates and Municipal Debt New Issuance outlooks are provided as a courtesy to institutional clients of Mischler Financial Group, Inc.

This document may be not reproduced in any manner without the permission of Mischler Financial Group. Although the statements of fact have been obtained from and are based upon sources Mischler Financial Group believes reliable, we do not guarantee their accuracy, and any such information may be incomplete. All opinions and estimates included in this report are subject to change without notice. This report is for informational purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Veteran-owned broker-dealer Mischler Financial Group, its affiliates and their respective officers, directors, partners and employees, including persons involved in the preparation of this report, may from time to time maintain a long or short position in, or purchase or sell a position in, hold or act as market-makers or advisors or brokers in relation to the securities (or related securities, financial products, options, warrants, rights, or derivatives), of companies mentioned in this report or be represented on the board of such companies. Neither Mischler Financial Group nor any officer or employee of Mischler Financial Group or any affiliate thereof accepts any liability whatsoever for any direct, indirect or consequential damages or losses arising from any use of this report or its contents.

Cited by Wall Street Letter in each of 2014, 2015 and 2016 for “Best Research / Broker-Dealer”, the QC is one of three distinctive market comment pieces produced by Mischler Financial Group. The QC is a daily synopsis of everything Syndicate and Secondary as seen from the perch of our fixed income trading and debt capital markets desk and includes a comprehensive “deep dive” with optics on the day’s investment grade corporate debt new issuance and secondary market data encompassing among other items, comparables, investment grade credit spreads, new issue activity, secondary market most active issues, and upcoming pipeline.

That is one heck of a Christmas present to the American middle class which – make no mistake about it – ISthe engine that drives the greatest country on the planet. To illustrate just how great this event could prove to be, let’s turn to the world’s 15th largest global company AT&T Inc. (NYSE:ATT) which announced it will give over 200,000 U.S. employees a special $1,000 bonus – to celebrate the signing of today’s historic tax bill! AT&T also committed to invest $1b in the U.S. in 2018.IG Spreads Set or Tie Post-Crisis Lows

The good news doesn’t stop there though! Getting more granular to our IG dollar DCM, today saw credit spreads set or tie new post-Crisis lows across the four IG asset classes and the 19 major industry sectors. It was bound to happen as IG secondary spreads continue to tighten given the absence of any new issuance here at year end among others. I suspect that despite the 10% reduction in IG Corporate new issuance being called for in 2018 as a consequence of the 21% corporate tax rate, there should also be a positive impact of the massive repatriation of trillions of dollars of offshore funds back to domestic corporate coffers. Overall, the new tax reform bill should reflect positively on IG credit quality.

Year-to-date we priced $1.333 trillion in IG Corporate new issues. Many are calling for a 10% reduction in 2018 IG Corporate issuance versus 2017 thanks to repatriation of funds. That would bring the amount down to $1.2tln. Backing out this year’s $200b in M&A related financings gets you to $1tln even. I think we’ll actually see another 5% increase to that number thanks to redemptions, etc so, and more utility and FIG activity that will bring us to $1.05tln. However, many issuers are looking at their new piles of cash as a “strategic asset” in which they will be asking, “what can we buy with all these new found greenbacks?” I think we’ll actually see ~$250bn in M&A-related financings. So, that would bring my total to $1.3tln.

So, $1.3tln is my call for 2018 IG Corporate new issuance. Remember I count split-rated issuance as long as one of the 3 IG ratings is by Moodys, S&P or Fitch and I also include IG rated $25 par Preferreds.

Additionally, today’s November Existing Home Sales beat by 5.06% or 5.81m vs. 5.53m the highest number in 11 years! The MoM number was 5.6% vs. 0.9% forecasts.

Here’s a look at WTD and MTD IG Corporate new issuance volume as measured against the syndicate desk estimates:

The IG Corporate WTD total is 0.00% of this week’s syndicate midpoint average forecast or $0.00m vs. $994mm.

MTD we’ve priced 79.96% of the syndicate forecast for December IG Corporate new issuance or $26.387b vs. $33b.

There are now 5 issuers in the IG credit pipeline.

Today’s IG Primary & Secondary Market Talking Points

The IG Average set a new post-Crisis low of +99; the “AA” asset class also set a new post-Crisis low of +56.

The “A” (+77) IG asset class tied its post-Crisis low for the second consecutive session. “BBBs” also tied it post-Crisis low of +129.

Of the 19 major industry sectors, a total of 9 of them (47.4%) set or tied their post-Crisis lows as follows: Basic Industry (+124) and Transportation (+102) set new lows while Banking (+82), Consumer Products (+84), Energy (+132), Industrials (+104), Insurance (+108), Real Estate (+111) and Services (+100) tied their post-Crisis lows.

· 12/20 – The House, in its re-vote cleared the tax rewrite for Trump’s signature 224-201. Tax Reform is official. One of the single greatest GOP legislative wins in history. 12/19 – The Senate passed the bill in a 51-48 vote after the House voted in support 227 to 203 (4 no votes) requiring a revote the 12/20 due to a 529 home schooling technicality. A typical U.S. family will get an add’l. $2k in 2018, the U.S. Corporate tax rate would be reduced to 21%, Americans can choose their own healthcare and Tax Form is simplified. These are the largest tax cuts in U.S. history. President Trump said he wanted to sign the bill into law before Christmas.

· 12/19 – Yemeni rockets launched at the royal palace in Riyadh intercepted by Saudi forces. Iranian-backed rebels now targeting population and power centers in Saudi Arabia is more than enough to promote an act of war between KAS and Iran. 12/06 – Pres. Trump formally recognizes Jerusalem as Israel’s capital. Plans to move U.S. embassy there from Tel Aviv. Could take three years. Palestinian leader Mahmoud Abbas and Jordan’s King Abdullah warn Trump of dangerous consequences for stability and security in the Middle East. Turkey’s Erdogan threatens to cut ties with Israel calling the move a “red line for all Muslims” and decision puts “world and region in a ring of fire.” 12/04 – Former Yemeni President Ali Abdullah Saleh assassinated in Sanaa by former allied and Iranian-backed Houthis. Yemen, like Lebanon are sights of proxy wars fought between Saudi Arabia and Iran. 11/28 – Israeli Mossad working with Saudi’s General Intelligence Presidency (GIP) over mounting tensions with Iran. Shared interests against Iran are bringing both nation’s closer. Lebanon’s PM al-Hariri resigned from Saudi Arabia 11/05 blaming Iranian aggression. Abandons support of Iran’s Hezbollah terror group. Beirut, is proving ground for Saudi-Iranian proxy wars. Crown Prince Mohammed bin Salman’s plans sweeping with “Vision 2030” to wean KSA off oil. Saudi inner players arrested in anti-corruption probe involving multi-billion dollar “settlements.” Both Trump and KAS share strong views of an anti-nuclear Iran. KSA needs oil above $81 to break even. Mideast tension expected to boost the price of oil.

· U.S. trade protectionism contrarian to the world coming together on trade. Long term impact?

MODERATE“China”

· 12/19 – Spain’s Rajoy announces snap elections on Thursday, Dec. 21st to help defray the Catalonian independence crisis. Could result in breakaway = could spread thru EU. Separatists remain ahead in latest polls 46.9% to 43.7% for the Unionists. 7.8% are “non-aligned.”

· Italian elections to be held no later than March 20th, 2018. 5-Star Populist Party leader Luigi Di Maio is hopeful for EU negotiations but said he would vote for an ITALEXIT if discussions fail. Italians are resistant to the EU’s stringent austerity measures. 5-Star holds a lead in polls.

Today the IG dollar DCM hosted 3 issuers across 7 tranches totaling $9.45b. The SSA space featured 4 issuers and 6 tranches for $7.50b bringing the all-in IG day totals to 7 issuers, 13 tranches and $16.95b. Clearly the mega deal of the day belongs to The Goldman Sachs Group, Inc. that issued a $7b three-part Senior Unsecured Global Notes transaction for which Mischler served as an active Co-Manager on the 21nc20 fixed-to-floating tranche due 10/31/2038. That deal and more specifically that tranche is today’s Deal-of-the-Day.

Here are the day’s recaps first:

The DOW skyrocketed 168 points to close at a new all-time high of 23,441 propelled by stellar earnings from the likes of Caterpillar, 3M, GM and Fiat Chrysler.

Here’s how the session’s IG Corporate new issue volume impacted the WTD and MTD syndicate estimates:

The IG Corporate WTD total is 108.88% of this week’s syndicate midpoint average forecast or $23.724b vs. $21.79b.

MTD we’ve priced 98.36% of the syndicate forecast for October IG Corporate new issuance or $90.178b vs. $91.68b.

There are now 8 issuers in the IG credit pipeline.

Today’s IG Primary & Secondary Market Talking Points

Mischler Financial is proud to have been named a Selling Group member on today’s $1bn Ford Credit Auto Lease Trust Series 2017-B. Thank you Team Ford for choosing Mischler from among your diversity candidates.

The average spread compression from IPTs and/or guidance thru the launch/final pricing of today’s 7 IG Corporate-only new issues was <18.71> bps.

BAML’s IG Master Index was unchanged at +101 tying its post Crisis low set with last Friday’s close.

Today’s Goldman Sachs transaction was a $7bn three-part comprised of a 5nc4 fixed-to-floater as well as a 5yr FRN both due 10/31/2022. Mischler proudly served as an active Co-Manager on today’s longest tranche of that issuance – the 21nc20 fixed-to-floating due 10/31/2038 so I am writing about that tranche this evening.

It’s important to note that in speaking with today’s accounts they like the pro-U.S. growth sentiment and rates that are helping to boost markets especially for bank and finance issuers. Broader corporate tax reform will certainly lead to additional M&A activity ahead which is good for banks/finance. Several international accounts expressed their view that U.S. banks as flight to relative safety underscore an overall bullish sentiment in the sector. Other investors were attracted by some additional yield compared to the risk-reward in European banks and Asian banks. We’ve seen some front-loaded supply in the sector post Q3 earnings but the demand for GS paper has been consistently strong.

BAML’s IG Master Index was unchanged at +101 tying its post Crisis low set with last Friday’s close.

Here’s a review of this week’s five key primary market driver averages for IG Corporates only through Monday’s session followed by the averages over the prior six weeks:

KEY IG CORPORATE
NEW ISSUE DRIVERS

MON.
10/23

AVERAGES
WEEK 10/16

AVERAGES
WEEK 10/09

AVERAGES
WEEK 10/02

AVERAGES
WEEK 8/25

AVERAGES
WEEK 8/18

AVERAGES
WEEK 9/11

New Issue Concessions

1.33 bps

0.41 bps

<0.38> bps

1.18 bps

1.38 bps

0.62 bps

1.40 bps

Oversubscription Rates

2.23x

2.89x

3.03x

3.50x

3.31x

3.18x

3.27x

Tenors

6.20 yrs

8.85 yrs

9.77 yrs

12.00 yrs

8.50 yrs

8.21 yrs

9.84 yrs

Tranche Sizes

$793mm

$804mm

$906mm

$608mm

$645mm

$483mm

$674mm

Avg. Spd. Compression
IPTs to Launch

<12.75> bps

<16.81> bps

<19.81> bps

<18.40> bps

<20.19> yrs

<18.40> bps

<18.91> bps

Rates Trading Lab

Most of today’s trading was confined to a tight range with yields slowly migrating higher as the curve steepened. Then came the news that John Taylor had reportedly won a straw poll on a show of hands when President Trump asked GOP Senators about their Fed pick. Market got hit with the belly leading the sell-off and 5yrs traded at 2.044%, 10yr at 2.4225% and 30yr 2.934%. Stops were hit in futures as TY touched 124-18 before bouncing. Taylor had a big day in the betting pools, for what it’s worth, solidifying his second place standing. https://www.predictit.org/Market/3306/Who-will-be-Senate-confirmed-Fed-Chair-on-February-4%2C-2018 Lost in the fray were reports that the trio of Corker, McCain and Paul might not support a tax cut program if not revenue neutral and that Jeff Flake bowed out of the Arizona Republican race, but not before saying that “[w]ithout fear of the consequences and without consideration of the rules of what is politically safe, we must stop pretending that the conduct of some in our executive branch are normal. They are not normal. Reckless, outrageous and undignified behavior has become excused as telling it like it is when it is actually reckless, outrageous and undignified.” Meanwhile, stocks carried on, with records falling once again and the financial networks straining to contain their giddiness.

Thoughts:

Today’s price action was a textbook case of why this market is becoming so difficult to trade. I understand that a Taylor chairmanship and its potentially consequential rules-based policy metrics is a decidedly hawkish event. Countering that, however, is more stagnation on the legislative front. Senators Corker and Flake are now question marks in the Republican camps along with the fiscal conservatives. I know we have broken through established support levels and that it may trigger a further sell-off on that basis alone, but I think this is a counter-trade. Whatever happens, it will happen fast. Machines can hit bids and lift offers faster than you can blink.

Although next week is a holiday shortened one, credit spreads are tightening, the VIX set a new low yesterday and equity markets continue setting new all-time highs. The CT10 is yielding 2.35% at mid-day today so post-Q3 earnings I expect to see a nice rush to print through the end of the year amidst future rate hike sentiment. I have maintained that rates will increase at the top of 2018, which means at the January 31st FOMC meeting, however, that’s my take. “If” the meeting was held today, the chances of a Fed hike are currently 86%. Remember folks there is a LOT playing out in our new world order. So, why is the VIX so low? First, the VIX is a street standard index so I will continue to post it here in the “QC” until perhaps one day it loses its prestige with market participants. Having said that, it IS the index most akin to gambling with one’s emotions. Unlike a basket of stocks or an index in which we can strip out good apples from bad apples, reverse engineer etc., the VIX volatility index gages market sentiment more than other indices. It’s an indication that the market believes everything is good in the world of finance when in fact, the world is far from that. With myriad highly volatile global event risk factors playing out each and every day think about this – the Fed has NEVER had to unwind a $4.5 trillion balance sheet. Europe has NEVER dealt with a BREXIT. We have NEVER experienced the current high level threat of nuclear rhetoric and rapid development as exists with North Korea and that includes the throes of the Cold War during the early ‘60s. Scroll down to my “QC” Geopolitical Risk Monitor just below for some other developing items. When one of the major events turns south the VIX will spike!

As for our IG dollar DCM, we do have some big news for next week namely – Citigroup and J.P. Morgan announce Q3 earnings on Thursday, October 12th and Bank of America and Wells Fargo release earnings on Friday the 13th. Goldman Sachs and Morgan Stanley follow on Tuesday the 17th. They are the smart money and they lead the way for issuance each quarter. They have more to do before 2017 is a wrap and I strongly suspect we’ll see hefty cumulative issuance from the six-pack. The average estimate for next week’s IG Corporate only new issue volume is $20.875b. The high estimate was $26b from one desk and five others said $15b either flat out or as part of a range.

All 24 syndicate desks in my weekly “QC” survey responded once again and they are waiting below to make an early exit ahead of traffic on this start of a welcome three-day weekend. Please scan through the below recaps and I promise you they’ll wait for you with their comments and numbers for next week before the well-deserved Columbus Day weekend! So, sit back, relax and enjoy this Best & Brightest edition of the “QC.”

Here’s how this week’s IG Corporate volume numbers measure up against the WTD and MTD syndicate estimates:

The IG Corporate WTD total is 77.22% of this week’s syndicate midpoint average forecast or $14.595b vs. $18.90b.

MTD we’ve priced 15.92% of the syndicate forecast for October IG Corporate new issuance or $14.595b vs. $91.68b.

There are now 10 issuers in the IG credit pipeline.

Today’s IG Primary & Secondary Market Talking Points

BAML’s IG Master Index was unchanged at +104 tying its post-Crisis set on Wednesday and that previously dated back to July 2007.

Investment grade corporate bond trading posted a final Trace count of $16.9b on Thursday versus $20.3b on Wednesday and $18.9b the previous Thursday.

The 10-DMA stands at $17.6b.

The “QC” Geopolitical Risk Monitor

Risk Level/Main Factor

Geopolitical Risks

HIGH
North Korea

10/6 – Russian news announces NOKO is preparing to test fire a missile capable of reaching the U.S. Coast. Recall Trump’s “calm before the storm” comment. NOKO rumored to reach out to GOP to help “figure out Trump.” On 9/24 Trump warns NOKO leadership that if rhetorical threats continue its leaders “won’t be around much longer.” NOKO claims comment is an “Act of War” and that it now has the right to shoot down U.S. bombers “even outside of NOKO air space.” Beijing calls situation “grave.” On 9/19 Trump spoke before UN referring to Kim as “Rocket Man on a suicide mission.” Trump says “if Kim continues to threaten the U.S., allies and the world, we will have no choice but to totally destroy North Korea.”

ELEVATED“The EU”

-Regional parliament meets 10/9 defying a Spanish Constitutional Court suspension. Results of Catalonia’s Oct. 1st independence referendum vote posted 90% support for secession from Spain. National riot police cracked down at the voting booths injuring nearly 900 voters in what is the EU nation’s worst territorial crisis since turning to democracy 40+ years ago. Catalan leadership is divided on rush to independence given potential civil unrest and economic consequences. Germany’s Angela Merkel re-elected to her 4th term but nationalist Alternative for Germany (AfD) party & other right wing parties gain to force a 6-party coalition government. Worst performance for Merkel’s CDU and Christian Social Union party since 1949. Immigration a source of tension. Right wing has a seat in German decision-making.

-EU and Macron-Merkel coalition to squeeze U.K. re: BREXIT “divorce” bill. Companies prepping for hard BREXIT & 2 years of weak growth. PM May wants rolling series of meetings with EU. UK withdrawal from EU takes place in March, 2019. Moody’s downgraded the U.K. to Aa2 from Aa1.

CAUTION“U.S. political gridlock”

GOP tax overhaul plan would, in their view, double deduction and create 3 tax brackets vs. 7. Bringing Corporate rate to 20% might return trillions of dollars to the U.S. that corps are keeping overseas. Consensus GOP support to pass legislation still in doubt. Partisan politics. Trump recently bypassed GOP to close a deal w/Dems to extend debt limit to December.

-Las Vegas mass shooting on Sunday 10/01 is the worst in U.S. history killing 58 and 515 injured.

-October MTD Terror Stats: Despite destroying the Caliphate, ISIS is now scattered across a wider MENA region and Europe. October MTD there were 13 terrorist attacks. Killing 64 people and wounding 72.

-On July 28th Pakistani Prime Minister Nawaz Sharif was ousted for his role in a corruption scandal. He selected his brother Shahbaz to take over. The Brookings Institute calls Pakistan “the world’s most dangerous country.” Democracy in nuclear-armed country with 205m population at risk.

-Mueller’s continuing FBI probe into Trump.

MODERATE“China”

-China hard landing: rising corporate debt & slower GDP growth are OECD and IMF concerns. National Congress of the Chinese Communists Party held on Oct. 18th. Most decisions are made prior to it but it’s historically pivotal regarding leadership changes & reshuffling as elders retire.

Syndicate IG Corporate-only Volume Estimates For This Week and October

IG Corporate New Issuance

This Week
10/02-10/06

vs. Current
WTD – $14.595b

October 2017

vs. Current
WTD – $14.595b

Low-End Avg.

$17.54b

83.21%

$90.96b

16.05%

Midpoint Avg.

$18.90b

77.22%

$91.68b

15.92%

High-End Avg.

$20.25b

72.07%

$92.42b

15.79%

The Low

$10b

145.95%

$110b

13.27%

The High

$26b

56.13%

$75b

19.46%

Rates Trading Lab- Mischler’s Tony Farren Reports In

Economic data this week, outside of payrolls, has been very good (details below). Treasuries have traded poorly over the last four weeks. The 10yr is currently trading at 2.40% (98-22) the level where buyers are expected to step in. The 2yr (1.524%) traded at a yield not seen since 2008. Considering the sell off over the last four weeks in USTs it makes sense for the shorts to start to cover some of their positions at current levels. Remember the longs basically did not exist in this week’s JPM Survey. I expect the 2.40% in 10’s to hold today before the long weekend (Columbus Day on Monday).

Looking ahead at factors that could impact the Treasury market –

What did President Trump’s comment last night “calm before the storm” mean? (North Korea?)

What happens between Madrid and Catalonia?

Does the GOP deliver on Tax Reform?

Do the U.S. and Global stock market rallies continue or take a breather?

Who does President Trump select as Chair of the FOMC?

Fed-speak will be active again next week

The FOMC Minutes from the Sept 19-20 Meeting will be released on Wednesday.

Next week’s Treasury supply will be a challenge for the UST market.

($56 billion in 3’s, 10’s & 30’s next Wednesday & Thursday)

PPI will be released on Thursday.

CPI will be released on Friday.

Retail sales will be released on Friday.

Tropical Storm Nate could impact the U.S. on Sunday as a hurricane.

As for recent economic data, it seems too good to be true with Payrolls the exception. Is the theory that hurricanes are a short term negative for the economy wrong? This week’s data makes that a fair question to ask –

ISM manufacturing the strongest since 2004 (Mon).

ISM non-manufacturing the strongest since 2005 (Weds).

Vehicle sales this month were very strong (Tues).

Unemployment Rate has not been lower since Dec 2000.

The U6 rate has not been lower since May 2007.

Average hourly earnings MoM has not been higher since June 2007.

Average hourly earnings YoY has not been higher since 2009.

The Participation Rate has not been higher since September 2013.

Household employment and labor force both had sizeable gains.

Here are the negatives from this morning’s Employment Report –

Payrolls were negative for the first time since August 2010.

The two-month revision for payrolls was <38k>.

Average weekly hours was unchanged.

-Tony Farren

The Best and the Brightest” Syndicate Forecasts and Sound Bites for Next Week

I am happy to announce that the “QC” once again received 100% unanimous participation from all 24 syndicate desks surveyed for today’s “Best & Brightest” edition! Thank you to all of them. 20 of those participants are among 2017’s YTD top 21 ranked syndicate desks according to today’s Bloomberg’s U.S. IG U.S. Investment Grade Corporate Bond underwriting league table. The 2017 League table can be found on your terminals at “LEAG” + [GO] after which you select (US Investment Grade Corporates). The participating desks represent 81.59% of all IG dollar-denominated new issue underwriting as of today’s table share percentage which simply means they’re the ones with visibility. But it’s not only about their volume forecasts, it’s also about their comments! This core syndicate group does it best; they know best; so they’re the ones you WANT and NEED to hear from. It’s a great look at the week ahead.

*Please note that these are Investment Grade Corporates only. They do not include SSA issuance unless otherwise noted.

As always “thank you” to all the syndicate desks that participated in today’s survey. I greatly appreciate your time to contribute and for making this edition of the “QC” among the most widely read! You are helping to promote Mischler’s value-added DCM proposition while adding readership to the “QC” that won Wall Street Letter’s Award as Best Broker Dealer Research in our financial services industry for three consecutive years! That’s 2014, 2015 and 2016 !! More importantly, however, you are helping the nation’s oldest Service Disabled Veteran broker-dealer grow in a more meaningful and sustainable way. So, thank you all! -RQ

Let’s dive right into this week’s primary market recap and data downloads as a segue to our syndicate desk canvass as to what is in expected next week i.e. DCM market and new investment grade corporate debt issuance.

North Korea remains global event risk factor number 1 with Kim Jong-Un’s regime making no progress this week toward negotiating with the U.S. When NOKO is dormant it means something is brewing and/or amiss. Stay thirsty my friends!! Spanish Catalonia adds more EU suspense to the mix with 90% support for secession from Spain. The independence referendum, in defiance of the Spanish Constitutional Court, erupted in violence with Spanish National police injuring over 900 voters in attempts to prevent citizens from voting. Catalonia’s regional parliament meets on Monday, October 9th in defiance of the Spanish Court’s suspension. GOP hopes of tax reform legislation may not appear until early in 2018 and it remains to be seen what support it has with opposition coming from within the party. Earlier this week we saw the impact of hurricanes Harvey, Irma and Maria on Vehicle Sales while this morning’s numbers confirm how skewed they will be going forward. Clearly the hurricanes reduced the NFP number this morning as unemployment fell while the labor force participation rate rose. Any weak number is chalked up to storms while strength is attributed to a resilient economy. Go figure!Entering this morning’s Friday session –

The IG Corporate WTD total stands at $14.595b. We priced $4.305b less than this week’s average estimate of $18.90b or 77.22%.

MTD we have now priced 15.92% of the syndicate projection for October IG Corporates or $14.595b vs. $91.68b.

Entering today’s session, the YTD IG Corporate-only volume is $1,089.746b vs. $1,088.336b on October 6th, 2016 or 0.13% more than a year ago.

The all-in or IG Corporate plus SSA YTD volume is $1,349.204b vs. $1,374.92b on October 29th, 2016 or 1.91% less than the year ago total.

Entering this morning’s session, here are the five key primary market driver averages from the 28 IG Corporate-only deals that priced this week.

Spreads across the four IG asset classes tightened 2.50 bps to 1.75 bps vs. 4.25 bps as measured against their post-Crisis lows.

The 19 major industry sectors also tightened 4.21 bps to 5.32 vs. 9.53 bps also as measured against their post-Crisis lows.

For the week ended October 4th, Lipper U.S. Fund Flows reported an inflow of $3.770b into Corporate Investment Grade Funds (2017 YTD net inflow of $96.388b) and a net inflow of $645.473m into High Yield Funds (2017 YTD net outflow of $7.331b).

Taking a look at the secondary trading performance of this week’s 24 IG Corporate and 4 SSA new issues, of the 28 deals that printed, 20 tightened versus NIP for a 50% improvement rate, 3 widened (10.50%) and 5 were flat (18.00%).

The VIX closed yesterday at a new low of 9.17 (Amazing!) while issuance is running neck and neck with last year’s record pace given low rates and tightening spreads. 7 of the 19 IG sector spreads set or equaled post Crisis lows this week and 2 of the 4 IG asset classes did the same!

Entering today’s Friday session here’s how much we issued this week:

IG Corps: $14.595b

All-in IG (Corps + SSA): $26.475b

And now ladies and gentlemen, as honored members of the “B&B” Club it’s time for the guy-in-the corner to ask today’s question “what are your thoughts and numbers for next week’s IG Corporate new issue volume?”

As always, I hope the daily “QC” and my data downloads are helpful and informative to you. Without your participation this widely read “QC” survey edition can’t get done. I greatly appreciate your meaningful sound bites that bring your numbers and ranges to life. A LOT of Fortune Tsy teams read this every day and they love it! I consistently receive positive feedback about the “QC” from them directly. Wall Street fixed income syndicates desks that contribute to this column are directly contributing to a much bigger picture, while also helping the nation’s oldest Service Disabled Veteran broker-dealer build in a more meaningful and sustainable way.

Please know that on each and every new issue, the guy-in-the-corner is ALWAYS be in YOUR corner on deal day! If an issuer asks you who some of the best diversity firms are, my hope is that you’ll mention Mischler Financial and the guy-in-the-corner. Our distribution is high quality, prolific and consistent. On deal day, we perform enough to influence your bid-to-cover rates with REAL unpadded orders. Besides where else can you get an award winning daily fixed income DCM piece for FREE? But most of all, we have a great certification as the nation’s oldest Service Disabled Veteran broker-dealer. We demonstrate remarkable authenticity here at Team Mischler. Our commitment to our demographic is our foundation. We donate 10% of our earnings to heavily-vetted veteran foundations and non-profits to help our active and veteran service men and women and their families. It’s all well worth it and I hope you think so too!
Thank you and wishing you and yours a great long Columbus Day weekend! -Ron”

Last week muni volume was about $8.7 billion. This week volume is expected to be $5.0 billion. The negotiated market is led by $500 million taxable bonds for Northwestern University and $301.5 million for Dormitory Authority of the State of New York for School Districts. The competitive market is led by $1.7 billion tax-exempt and taxable PIT bonds for Dormitory Authority of the State of New York in 5 bids on Tuesday.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6656

For reading ease, please click on image below

Since 2014 alone, minority broker-dealer Mischler Financial Group Inc.’s presence across the primary Primary Debt Capital Markets (DCM) space has included underwriting roles in which Mischler has led, co-managed and/or served as selling group member for more than $600 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

This document may be not reproduced in any manner without the permission of Mischler Financial Group. Although the statements of fact have been obtained from and are based upon sources Mischler Financial Group believes reliable, we do not guarantee their accuracy, and any such information may be incomplete. All opinions and estimates included in this report are subject to change without notice. This report is for informational purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Veteran-owned broker-dealer Mischler Financial Group, its affiliates and their respective officers, directors, partners and employees, including persons involved in the preparation of this report, may from time to time maintain a long or short position in, or purchase or sell a position in, hold or act as market-makers or advisors or brokers in relation to the securities (or related securities, financial products, options, warrants, rights, or derivatives), of companies mentioned in this report or be represented on the board of such companies. Neither Mischler Financial Group nor any officer or employee of Mischler Financial Group or any affiliate thereof accepts any liability whatsoever for any direct, indirect or consequential damages or losses arising from any use of this report or its contents.

Last week muni volume was about $5.4 billion. This week volume is expected to be $9.9 billion. The negotiated market is led by $1.1 billion for the Texas Water Development Board. The competitive market is led by $846.8 million general obligation bonds for the State of Minnesota in 5 bids on Wednesday.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6656

For reading ease, please click on image below

Since 2014 alone, minority broker-dealer Mischler Financial Group Inc.’s presence across the primary Primary Debt Capital Markets (DCM) space has included underwriting roles in which Mischler has led, co-managed and/or served as selling group member for more than $600 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

This document may be not reproduced in any manner without the permission of Mischler Financial Group. Although the statements of fact have been obtained from and are based upon sources Mischler Financial Group believes reliable, we do not guarantee their accuracy, and any such information may be incomplete. All opinions and estimates included in this report are subject to change without notice. This report is for informational purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Veteran-owned broker-dealer Mischler Financial Group, its affiliates and their respective officers, directors, partners and employees, including persons involved in the preparation of this report, may from time to time maintain a long or short position in, or purchase or sell a position in, hold or act as market-makers or advisors or brokers in relation to the securities (or related securities, financial products, options, warrants, rights, or derivatives), of companies mentioned in this report or be represented on the board of such companies. Neither Mischler Financial Group nor any officer or employee of Mischler Financial Group or any affiliate thereof accepts any liability whatsoever for any direct, indirect or consequential damages or losses arising from any use of this report or its contents.

Last week muni volume was about $5.6 billion. This week volume is expected to be $4.7 billion. The negotiated market is led by $900.0 million taxable bonds for Northwell Healthcare, Inc. and $854.3 tax-exempt and taxable bonds for The Regents of the University of California. The competitive market is led by $178.3 million general obligation bonds for Cherry Creek School District No. 5, Colorado in 2 bids on Thursday.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6656

For reading ease, please click on image below

Since 2014 alone, minority broker-dealer Mischler Financial Group Inc.’s presence across the primary Primary Debt Capital Markets (DCM) space has included underwriting roles in which Mischler has led, co-managed and/or served as selling group member for more than $600 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

This document may be not reproduced in any manner without the permission of Mischler Financial Group. Although the statements of fact have been obtained from and are based upon sources Mischler Financial Group believes reliable, we do not guarantee their accuracy, and any such information may be incomplete. All opinions and estimates included in this report are subject to change without notice. This report is for informational purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Veteran-owned broker-dealer Mischler Financial Group, its affiliates and their respective officers, directors, partners and employees, including persons involved in the preparation of this report, may from time to time maintain a long or short position in, or purchase or sell a position in, hold or act as market-makers or advisors or brokers in relation to the securities (or related securities, financial products, options, warrants, rights, or derivatives), of companies mentioned in this report or be represented on the board of such companies. Neither Mischler Financial Group nor any officer or employee of Mischler Financial Group or any affiliate thereof accepts any liability whatsoever for any direct, indirect or consequential damages or losses arising from any use of this report or its contents.

Today’s IG Corporate dollar DCM finished with a YTD record of 14 issuers that priced 22 tranches between them totaling $14.675b. Leading the pack: Aetna (NYSE: AET), American Water Capital, Ares Capital (NASDAQ: ARCC), Duke Energy (NYSE: DUK), Kraft Heinz (NYSE:HNZ), Regions Financial (NYSE: RF), and UBS Group (NYSE: UBS). The SSA space was quiet. This past March 6th the IG Corporate space featured 12 issuers and April 27th also hosted 12 IG Corporate issuers. But today takes the cake for the most number of issuers YTD. The DJIA closed at its 9th consecutive new high. The S&P also ended the session at a new all-time high.

Here’s how this week’s IG Corporate volume numbers measure up against the WTD and MTD syndicate estimates:

The IG Corporate WTD total is 42.80% of this week’s syndicate midpoint average forecast or $14.675b vs. $34.29b.

MTD we’ve priced 45.13% of the syndicate forecast for July or $35.70b vs. $79.10b.

There are now 4 issuers in the IG credit pipeline.

Today’s IG Primary & Secondary Market Talking Points

Kimco Realty Corp. upsized its $25 par PerpNC5 Class “L” cumulative redeemable preferred stock new issue to $225mm from $150mm at the launch and at the tightest side of price talk.

· N. Korea launches ICBM on 7/28. Jong-Un claims Hwasong-14 missile can reach any location on the U.S. continent. UN projects worst famine in NOKO in 17 yrs; last one killed 2mm (8% of population). Fear that NOKO may use nuclear intel/systems as barter for food w/”suspect” nations. U.S. has already sanctioned certain Chinese banks to pressure the PRC to use more influence over NOKO which has failed. U.S. lofts Trident missile in Pacific Ocean in response. China insiders say PRC does not have the influence on NOKO that the U.S. thinks it does.

ELEVATEDBREXIT Fallout

· U.K. PM May is on the hot seat. Macron-Merkel coalition to squeeze U.K. for all it can. France pressing for $115b equivalent.
Venezuela – civil unrest as Maduro dictatorship claims bogus election outcome favors unlimited powers and a new constitutional assembly in elections that U.S. and key LATAM nations will not acknowledge. Caracas named most dangerous city in the world with highest murder rate. VZ gov’t stopped publishing crime stats a decade ago. Dictatorship in our Western Hemisphere. U.S. Tsy. freezes Maduro family assets.

Let’s go straight to the “QC” Deal Dashboard for pricing intel and book sizes/bid-to-cover rates. Here’s a look at spread compression throughout price evolution during today’s two-part book build from IPTs to the launch and final pricing:

Issue

IPTs

GUIDANCE

LAUNCH

PRICED

Spread
Compression

NICs
(bps)

6NC5 FRNs

3mL+equiv

3mL+equiv

3mL+95

3mL+95

<20> bps

2.5

6NC5F-t-F

+125a

+110a (+/-5)

+105

+105

<20> bps

2.5

………and here’s a snap shot of today’s final book sizes and oversubscription rates:

Mischler Muni Market Market Update for the week of 08-07-17 looks back to last week’s metrics and provides a focused lens on muni bond new issuance scheduled for the upcoming week. As always, the Mischler Muni Market Outlook offers public finance investment managers, institutional investors focused on municipal debt and municipal bond market participants a summary of the prior week’s municipal debt activity, including credit spreads and money flows, and a curated view of pending municipal finance offerings tentatively scheduled for this week’s issuance.

Last week muni volume was about $7.0 billion. This week volume for muni bond issuance is expected to be $7.3 billion. The negotiated market is led by $1.1 billion tax-exempt and taxable bonds for Cleveland Clinic Health System issued by the State of Ohio. The competitive market is led by $1.5 billion tax-exempt and taxable bonds for New York City Transitional Finance Authority, New York, on Tuesday.

Below and attached is neither a recommendation or offer to purchase or sell securities. Mischler Financial Group is not a Municipal Advisor. For additional information, please contact Managing Director Richard Tilghman at 203.276.6656

For reading ease, please click on image below

Since 2014 alone, Mischler Financial Group Inc.’s presence across the primary Primary Debt Capital Markets (DCM) space has included underwriting roles in which Mischler has led, co-managed and/or served as selling group member for more than $600 Billion (notional value) in new debt and preferred shares issued by Fortune corporations, as well as debt issued by various municipalities and US Government agencies.

Mischler Financial Group is the securities industry’s oldest minority broker-dealer owned and operated by Service-Disabled Veterans. Mischler is also a federally-certified Service-Disabled Veteran Owned Business Enterprise (SDVOBE). Mischler Muni Market updates are provided as a courtesy to institutional clients of Mischler Financial Group, Inc.

This document may be not reproduced in any manner without the permission of Mischler Financial Group. Although the statements of fact have been obtained from and are based upon sources Mischler Financial Group believes reliable, we do not guarantee their accuracy, and any such information may be incomplete. All opinions and estimates included in this report are subject to change without notice. This report is for informational purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security. Veteran-owned broker-dealer Mischler Financial Group, its affiliates and their respective officers, directors, partners and employees, including persons involved in the preparation of this report, may from time to time maintain a long or short position in, or purchase or sell a position in, hold or act as market-makers or advisors or brokers in relation to the securities (or related securities, financial products, options, warrants, rights, or derivatives), of companies mentioned in this report or be represented on the board of such companies. Neither Mischler Financial Group nor any officer or employee of Mischler Financial Group or any affiliate thereof accepts any liability whatsoever for any direct, indirect or consequential damages or losses arising from any use of this report or its contents.